There are currently over 6,030 transaction coordinators in the U.S. So, if you’re thinking about starting your own business as a real estate transaction coordinator, you’re up against some tough competition.
However, the services you would provide as a real estate transaction coordinator—or TC for short—are in high demand. These services are increasingly key to closing deals successfully and on time.
In fact, 98% of real estate agents who use a coordinator close more transactions per month than those who don’t.
As you can see, there’s potential for you to run a highly profitable transaction coordination business in the real estate industry.
In this guide, you’ll learn how to start a real estate transaction coordinator business in just a few simple steps.
What Is a Transaction Coordinator and Why Are They Critical to Real Estate Businesses?
First, let’s consider why there is such a high demand for transaction coordinators.
Transaction coordinators keep real estate deals on track. They handle the administrative aspects of each transaction, from the initial contract to closing.
They have a broad role with duties that may vary slightly depending on state regulations. Typically, a professional transaction coordinator will:
- Coordinate property inspections.
- Manage escrow, mortgage loans, and appraisals.
- Ensure that all relevant documentation is gathered and submitted.
- Keep everyone updated on the progress of the transaction.
- Meet all critical deadlines.
- Ensure that the client database system is up-to-date and accurate.
- Adhere to all the necessary regulations.
- Ensure file compliance.
- Coordinate the real estate processes from start to closing.
Based on the list above, it’s fair to say that a real estate transaction coordinator plays a vital role in a real estate brokerage.
Hiring a great transaction coordinator frees agents up to focus on what they do best—selling properties.
This helps to:
- Ensure every real estate deal closes on time.
- Prevent documents from getting lost.
- Increase revenue, as you’ll likely be closing more deals successfully.
Having these tasks handled professionally also keeps agents and clients happy and ensures that real estate businesses are well-prepared when auditors visit.
💡 What Is the Difference Between a Transaction Coordinator and an Administrative Assistant?
An administrative assistant typically handles basic day-to-day tasks such as paperwork. A real estate transaction coordinator specializes in transactions.
Who Would Use an Outsourced Transaction Coordinator?
Some brokerages hire in-house transaction coordinators, while others outsource this coordination role to part-time or virtual transaction coordinators.
Most new real estate agents and brokers coordinate transactions themselves. This is usually because they process fewer deals, which gives them more time to handle administrative tasks. They also typically have fewer funds available to pay a transaction coordinator.
But as their business grows, they find that they need to commit an increasing amount of time to sales.
This means more revenue but less time to manage the transaction process, making hiring a transaction coordinator more appealing, especially if oversights and mistakes begin to surface.
However, hiring an in-house transaction coordinator is expensive, even if they are employed part-time.
Usually, a small but growing real estate business will hire an external or virtual transaction coordinator. This gives them the flexibility to pay only for the services they use. It also prevents them from potentially losing money if they have a period where they don’t close any deals.
As brokerages become bigger and their revenue increases, hiring an in-house transaction coordinator may become necessary. However, some still prefer to outsource this role so they can focus exclusively on sales. This is where you come in.
Is Being a Transaction Coordinator for You?
At this point, you may be wondering if fulfilling this role and starting your own business is the right move for you.
If you’re considering starting your own transaction coordinator business, it’s likely you already have experience in this area.
But you must consider if committing solely to this role is your best option, especially if you’re a licensed real estate agent.
The best transaction coordinators need to have a very specific set of skills and characteristics, including:
- Attention to detail.
- The ability to consistently meet deadlines.
- They are customer-oriented.
- The ability to make critical decisions.
- A logical and process-driven approach.
- Excellent communication skills.
8 Steps for Setting Up Your Own Transaction Coordinator Business
Now that you know there’s a demand for transaction coordinators and that your business may have a high chance of success, it’s time to start setting it up.
It’s worth noting that the steps below are quite broad and will differ depending on several factors. For example, some states may require that you obtain a real estate license to become a qualified transaction coordinator.
1. Choose a business name
Choosing the name of your transaction coordinator business will likely require some thought, but it’s often one of the more straightforward steps.
Research and brainstorm to pick a simple, professional name that reflects your business values.
Consider keyword value
It’s also important to consider a name with keyword value for people to find via Google. In other words, choose a name that aligns with the real estate industry and your transaction coordinator business service offering.
When you’re setting up a real estate office, a business name with keyword value will help ensure the name you choose is aligned with online search intent and discoverability when you start your marketing activities.
After you’ve selected a name for your business, purchase a website domain that’s an exact match—or as close of a match as possible.
Buying a .com domain name with your actual business name may be difficult. If .com is unavailable, consider other ideas, such as .realestate or .realty.
2. Set up your legal business entity
Next, you’ll need to establish your business as a legal entity. The type of business structure you choose is one of the most important decisions when starting a real estate transaction coordination company.
Setting up your business as an LLC or sole proprietor has very different implications regarding business management, taxation, and liability.
This step is vital. You must conduct proper research and due diligence before you decide on a business structure and file the required legal paperwork.
🚀 Transaction Coordinator Pro Tip:
The Small Business Administration website has some valuable resources on setting up your business.
It’s also advisable to consult a business formation or incorporation lawyer before you decide how to set up your business.
3. Acquire the right license
Real estate practice is governed by legislation at federal, state, and city levels.
Given the complexity of real estate law and practice, you’ll need to familiarize yourself with the requirements and regulations mandated by your state.
Brokers can face penalties for real estate noncompliance, so you must have a firm grasp of real estate compliance standards in your jurisdiction.
The license that you need to operate as a transaction coordinator depends on the state where you live and work.
If you plan on providing services to clients across different states, you will need to apply multiple standards simultaneously because each state has its own specific licensing rules.
For example, in Texas, working as a transaction coordinator without a license is illegal.
Research the laws that impact real estate transaction coordinators in your state to ensure your business is properly licensed.
4. Learn the basics of real estate transaction coordination
You’ll need various skills to become a successful transaction coordinator. Even if you’re an experienced TC or real estate professional, spend time learning the basics beyond what you know to serve your clients better.
Here are just some of the basics that you’ll need to understand:
The right real estate terminology
You’ll need to know some basic real estate terminology to communicate professionally with real estate agents, brokers, appropriate vendors, and other stakeholders.
The real estate transaction process from start to finish
The exact process differs from one area to another and depends on many factors, such as financing, property type, property condition, and representation. You’ll need to understand the entire transaction process, from listing to closing.
How to market your services properly
You’ll need to find suitable platforms to recruit real estate agents and connect with brokerages.
The right communication channels
You’ll need to establish the right channels to deal with agents, brokers, buyers, and sellers.
5. Choose the right transaction coordinator software
You will need to find the ideal software for your transaction-coordinating business.
As a real estate transaction coordinator, you will manage many of the administrative tasks associated with real estate transactions. Common tasks include:
- Managing listings and contracts.
- Coordinating open houses.
- Handling titles and escrow.
- Expediting mortgage loan and appraisal processes.
- Organizing inspections.
- Assisting in negotiations.
- Following up on the completion of repairs.
- Communicating with agents, brokers, buyers, and sellers throughout the real estate transaction process.
The problem with real estate software
What makes this challenging is that you’re often required to manage these tasks across multiple systems.
Many brokerages, even those in the same area, use several real estate transaction management software products simultaneously.
What to consider when choosing your software
To start and grow your company, you’ll need to choose software for seller transactions that works alongside any system a broker or a real estate agent might use.
If not, you may end up paying for features you don’t need and overcomplicate your process.
Choosing Paperless Pipeline
Often, you will need to create unique workflows for every agent and brokerage you work with. Paperless Pipeline can help you do just that.
The software allows you to work seamlessly with any other tools used by agents, with over 3,000 app integrations available.
It also enables you to automate transaction coordinator checklists for listings, acceptance, loan approval, option period, and appraisal dates in one system.
You can also:
- Keep clients up-to-date.
- See which real estate transactions have missing documents.
- Send cover letters with transaction milestones.
6. Set your rates
Typically, real estate transaction coordinators charge a fee for each closed transaction. The fee is often variable and can depend on several factors, such as:
- The type of clients you work with.
- Experience.
- Location.
- Level of service.
Here’s a general idea of what coordinators charge in the U.S. per hour, according to Talent.com:
The amount coordinators charge also varies by state. For example, the per-hour fee in South Carolina is $16.41, compared to $25 in Colorado.
Setting rates or determining your flat fee can be challenging, especially if you’re just starting as a transaction coordinator and new business owner.
Research your competitors’ rates
It’s a good idea to search online for what your competition charges. If you can’t find local transaction coordination companies to compare, consider looking at other states.
Many transaction coordinators work with multiple agents across many states, making them your direct competitors, too.
Determine when you will charge your clients
You will also need to decide at which stage you will charge clients for your services. Most transaction coordinators invoice clients upon project completion or at the end of the month for longer-term or rolling contracts.
Some transaction coordinators, however, ask clients to pay upfront.
7. Start marketing your new company
Once you’re set up and ready to begin coordinating real estate transactions, you’ll need to start marketing and recruiting.
This part of the process can be time-consuming and expensive, so finding creative ways to spread the word and acquire new clients is essential.
Marketing tips for transaction coordinators
Consider the following tips:
- Look for opportunities in Facebook groups used by realtors and other real estate transaction professionals, such as the Transaction Coordinator Collective.
- You should also check out online forums and TC groups. For example, the Reddit group r/realtors.
- Find opportunities at your local chamber of commerce. Use this website to find your nearest chamber of commerce.
- Network with real estate professionals on LinkedIn.
- Attend trade shows and events such as the REALTORS Conference & Expo.
🚀 Transaction Coordinator Pro Tip:
Offer to coordinate a potential client’s first deal for free. This is a great way to generate leads, and once the deal closes, it’s an easy way to convert that customer into a paying one for future transactions.
Other marketing tactics to consider
A few popular digital marketing tools you can use to market your new business include:
- Pay-per-click (PPC) advertising: This can be done on either search engines or social media platforms like Facebook.
- Email marketing: Create email campaigns and sequences, starting with a welcome email.
- Landing pages: Develop specific landing pages on your website aimed at particular target audiences.
- Content marketing: Write thought leadership articles and publish them on LinkedIn to establish your credibility.
8. Ask for testimonials and referrals
Testimonials are an excellent way for you to secure more work in the future. They can provide you with some much-needed credibility when you’re just starting.
Don’t be afraid to ask for testimonials from your first few clients. If you did a good job, ask a broker or real estate agent to write a quick review about the service you provided.
You can then quote these testimonials on your website or social media channels. This is also known as social proof.
Referrals are just as necessary. Fortunately, referral marketing is long-established in real estate and is no stranger to the clients you’ll be working with.
Test out referral incentive opportunities such as discounts, free coordination, and other perks for those who refer new clients to you.
How to Make It in the Real Estate Industry with Paperless Pipeline
Although there are many transaction coordinators to compete with, there is a high demand for these services.
If you want to be your own boss, have flexibility, and potentially work from home, this type of business might suit you perfectly. Not to mention that you’ll likely make good profits, especially if you follow the steps above.
If you want your new real estate business to thrive, you need to invest in the right software. With Paperless Pipeline, you can automate your entire transaction process, including your day-to-day tasks, while keeping all parties involved up to date.
Managing client information, data entry, and closing deals has never been easier!
Designed with transaction coordination in mind, our platform will allow you to run a profitable business easily.
Visit our website to start a free trial and find out whether Paperless Pipeline is the right solution for your new business.
